In this presentation, the author's goal is to help corporate decision-makers address a materiality gap by providing a practical methodology on how to estimate carbon related costs and benefits in financial terms using a registry-grade GHG inventory as its foundation. Companies are faced with significant analytical and operational challenges and uncertainties when planning long-term growth strategies and capital investments. One important aspect that is overlooked in traditional business decision processes is trying to account for potential carbon related risks and opportunities. The proposed framework allows a company to develop a top-down perspective through the lens of a Corporate Carbon Impact Statement supported by a carbon-conscious capital budgeting approach.

  • First, this presentation will discuss current climate policy and market drivers to gain an understanding of current and future requirements.

  • Second, current best practices in GHG emissions accounting will be discussed, including major challenges faced (such as defining organizational boundaries and selecting a consolidation methodology).

  • Third, the author will introduce the concept of a "Corporate Carbon Impact Statement" to help companies convert their GHG data into financial estimates of potential assets and liabilities.

  • Fourth, practical measures will be discussed, such as full implementation of internal risk governance and capital budgeting processes that can be utilized to integrate the impacts of GHGs into company's decision-making and offer financial management tools and techniques to assist that decision-making.

At the end, the author will present a carbon risk assessment framework to support global organizations faced with significant assets and liabilities posed by climate regulations and carbon markets.

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